A new national survey finds employers are facing double digit increases in health insurance premiums for the third year in a row.
The report from the Kaiser Family Foundation says in response to rising costs, businesses are shifting more of the burden on to their workers.
As New Hampshire Public Radio’s Dan Gorenstein reports those findings square with business realities in New Hampshire.
Gail Brewer owns Scotia Technology in Laconia. The firm makes precision metal parts for airplanes.
As recently as 2000, Brewer said she was pleased with the company’s insurance plan.
It was a typical HMO that allowed any of her 39 employees to go to the hospital without charge.
As premiums began to rise, so did the amount deducted from each worker’s paycheck.
But when the monthly cost topped $300, Brewer says it was too much.
11:53 ... This year when it was going up another ten percent to $316.17, we decided that we just couldn’t handle that. And neither could we ask an employee to pay over 100 dollars a week for their contribution to the insurance. So we went to a lesser benefit plan.
Workers now cover 20% of their hospital bills.
The pattern at Scotia Technologies repeats itself across the state and nationwide.
Gary Claxton with the Kaiser Family Foundation says for the second year in a row, premium growth has outpaced inflation by more than ten percentage points.
Claxton says rising costs are forcing employers to lean on their workers.
7:36 I think what we see is a continuing large premium increases that employer and employees are having to share. That in response to those, employers are increasing the out-of-pocket costs of workers for their health benefits. Maybe surprisingly they are not reducing the instances of when they offer benefits.
Brett St. Clair with the New Hampshire Business and Industry Association isn’t surprised businesses continue to offer some level of coverage.
He says employers sincerely want to help employees with healthcare costs.
But St. Clair says companies have been forced to adapt.
7:37 what some employers are even doing is for example, looking at capping the amount they will pay for insurance. Here is x amount of dollars, here is a menu of plans, but you are going to have to adjust your coverage accordingly.
It’s almost impossible for anyone in the state to avoid being touched by such changes.
John Andrews, executive director of the New Hampshire Municipal Association says cost increase aren’t limited to the private sector.
His organization runs an insurance plan for some 60 thousand public employees and their dependents.
How do local towns or school districts absorb these premium hikes
Track 1
4:26 essentially through higher taxes. In NH, our studies indicate that 20% of the insurance premium is paid for by the employee, with 80% by the property tax payer.
Theories abound on why costs are rising steadily.
Many healthcare experts say we are using more services, more expensive technology and more expensive drugs.
The Kaiser report suggests the most recent increase may be explained in part by insurers seeking bigger profits.
Anthem Blue Cross Blue Shield spokesperson Karen Brown says that’s not the case for her company in New Hampshire.
13:59 our operating gain decreased slightly, and the reason for that is what we were paying in claims increased, and we were able to offset that by an increase in membership.
In New Hampshire, the backdrop behind talk of increased premiums is new legislation passed this spring designed to attract new insurers to the state.
The law, SB110, allows companies to set different rates depending on the age and health of a company’s workforce.
Employers with young, relatively healthy employees hope to save money.
But for businesses with older workers, like Gail Brewer’s, Scotia Technology in Laconia, there is more apprehension than optimism.
Brewer says she is bracing for a 25% increase in premium rates next February.
For NHPR News, I’m DG
